What to Know

False Claims Act and Qui Tam Lawsuits

False Claims Act and Qui Tam Lawsuits in Los Angeles, California.

False Claims Act and Qui Tam Lawsuits

The California and federal False Claims Acts protect the government against fraud. If you believe you have witnessed fraud against the government, such as health care fraud, pandemic-related fraud, cyber fraud, defense contracting fraud, procurement fraud, disaster relief fraud or procurement fraud, call us at 888-762-0297 to discuss your potential claims.

We do not charge for consultations and can help clients everywhere in California.

Is There a California State False Claims Act?

California is one of twenty-nine states that have passed a false claims act. According to state law, the Attorney General can recover damages against anyone who commits fraud against the state. Fraud is a broad term that can cover a wide range of activities involving:

  • False statements or documents used to defraud the state of money or property
  • Acts committed to avoid paying or transmitting property to California

The US Federal False Claim Act also criminalizes creating a false report or claim that defrauds the government. In addition, the federal statute includes provisions for whistleblowers (also known as the qui tam plaintiff or a relator).

What Is A "Qui Tam" Lawsuit?

A qui tam lawsuit is a unique type of whistleblower claim. Qui tam lawsuits empower a whistleblower to sue on behalf of the government and recover funds lost to fraud. A qui tam lawsuit also entitles the whistleblower to a portion of the recovered funds.

Qui tam lawsuits are generally filed under seal, meaning they are kept secret.

Confidentiality allows the Justice Department enough time to investigate. A qui tam lawsuit works as follows:

  • The government investigates the claim to decide whether to intervene
  • A qui tam seal lasts for at least 60 days
  • Under some circumstances, the court may extend the seal
  • Most qui tam lawsuits are settled out of court

If the government chooses to move forward with the qui tam lawsuit, the whistleblower is still entitled to a portion of the recovery. If the government decides not to move forward with the lawsuit, the whistleblower may still proceed with their own claim.

What Does the California False Claims Act Cover?

At a high level it covers fraud against the government. Looking a little closer, it covers the use of false statements or documents to either get money or property from the state, or avoid paying or sending money or property to the state. Examples include:

  • Pandemic-Related Fraud
  • Health Care Fraud
  • Medicare and Medicaid Fraud
  • Defense Contracting Fraud
  • Mischarging and OverCharging Fraud
  • False Certification Fraud
  • Defective Pricing Fraud
  • Collusive Bidding Fraud
  • Fraudulent Negotiations
  • Reverse False Claim Fraud

Under the state's false claims act:

  • Claims less than $500 are not suitable for a qui tam lawsuit
  • People and organizations who later learn they benefited from the fraud committed, but fail to disclose it, may be held liable
  • The state will not pursue certain claims, such as those involving workers' compensation, or claims relating to California's Revenue and Taxation Code

Under the federal false claims act, whistleblowers can pursue claims against workers' compensation and other public entities. In addition, federal law provides a minimum penalty of $5,000 and a maximum of $10,000 (also subject to occasional adjustment)

What Violates the False Claims Act?

Violations under the False Claims Act are very serious. The key components to support and prove any false claims or qui tam lawsuit rely heavily on a willful disregard for the truth, actual knowledge, or deliberate ignorance.

Defrauding the government of funds can take many forms, including:

  • Presenting a false claim for payment
  • Using or making false records that are used in a false claim
  • Causing others to use falsified records in a claim
  • Conspiring or scheming to commit a false claim violation
  • Failing to return government money or property
  • Using fraudulent means to purchase government property
  • Falsifying receipts of government property or delivering a receipt of government property without verification
  • Selling government property under false pretenses
  • Preventing the government from collecting money or property owed through falsified records or statements

Violators of the state or federal false claims act face serious penalties if convicted.

California False Claims Act Statute of Limitations

The California false claims act statute of limitations is complex and depends on a wide range of factors. Generally, the statute of limitations ranges from three to ten years from the date of discovery. It is best to see a False Claims Act attorney to determine the limitations for your particular set of circumstances.

False Claims Act Protections for Whistleblowers

The California and Federal false claims acts protect whistleblowers from suffering employment discrimination. Whistleblowers are protected such as from the following acts of retaliation:

  • Termination
  • Demotion to a lower paying or less prestigious position
  • Suspension without apparent cause
  • Assignment to a less desirable work hours or shift
  • Negative performance reviews seemingly without reason
  • Threats of violence and harassment
  • Being denied a merited raise or not getting a deserved promotion

False Claims Act and Wrongful Termination

Historically, businesses and other entities will attempt to retaliate against a whistleblower by finding other grounds for termination. A whistleblower may bring a False Claims Act retaliation case and recover:

  • Back pay owed
  • Reinstatement of position
  • Special damages, including lawyers' fees and court costs
  • Emotional distress

For more information

If you suspect you have observed the presentation of a false claim, if you believe you are being punished for observing or reporting it, contact a California False Claims Act attorney today to discuss your case. We invite you to call us at 888-762-0297, for a confidential, informative and free consultation.

We work on a contingency basis. There are no fees unless we recover for you. Any costs we advance on your behalf are only reimbursed after a successful recovery.

We can help clients everywhere in California, including Los Angeles, Del Norte, Yolo County, Santa Clara, Alameda County, Calaveras County, Fresno County, San Francisco, Sacramento, Santa Barbara, San Diego, San Bernardino, San Jose, Oakland, and Orange County.

Last updated on August 22, 2022.

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Additional Resources

California False Claims Actions

California False Claims Act - Section 12654

California Attorney General's - False Claims Unit

U.S. Department of Justice - False Claims Act

U.S. House of Representatives - Civil Actions for False Claims

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